2012 economy fueled by Stamford and Danbury

Published 9:25 pm, Wednesday, January 4, 2012

With each power cable and electrical wire his crew runs, Ridgefield contractor Steve DiCiacco sees the economic momentum that is emerging this year from what was at times an ugly 2011.

"We're starting to see some light," DiCiacco, Preferred Electrical Contractors Inc.'s president, said by mobile phone Tuesday while picking up propane for a job his crew is working this week.

It's a major change from last year.

DiCiacco said business was off 35 percent in 2010 and in the second quarter of 2011, and he cut his field staff from 12 to six. Heading into the first months of 2012, with corporations starting to spend on renovations and projects, he has started to add workers, and now has eight in the field.

The momentum in the economy is not overwhelming, but it has more substance this year than in previous ones, said Edward Deak, a Fairfield University economics professor.

"The weight is on the side of being really cautious," Deak said. "It has the potential to be better than '11."

Major projects were announced in 2011 and actually started, including the $100 million conversion of the old Clairol plant in Stamford to the new home of NBC Sports and a $107 million expansion at Ridgefield pharmaceutical Boehringer Ingelheim.

At least 200 construction jobs are expected to be created at Boehringer Ingelheim, and the other developments will create hundreds more.

In Bridgeport, work moved forward on demolishing mothballed factories, like General Electric's sprawling complex on Boston Avenue. That, too, presents job opportunities and sets the stage for future development.

But last year was rough, especially in finance, considered by many to be the engine of Fairfield County's economy. Layoffs in the thousands were announced by major investment banks. Bonuses were trimmed, and continued pressure is felt on employment and revenues from problems in Europe and new regulatory requirements.

Deak said regulatory provisions for capital are again going to restrain Wall Street in 2012.

While Wall Street dominates the southwestern part of the county, defense is king in the east, and that, too, suffered a setback in 2011. Sikorsky Aircraft announced more than 1,000 job cuts.

Sikorsky, the county's single-largest employer, faces some potentially difficult days as the U.S. grapples with a huge budget deficit and defense spending is being reined in.

Still, the state's unemployment rate was 8.4 percent, which was 0.2 percent lower than the national rate. Fairfield County had the lowest unemployment rate in the state, with the Danbury metro region at 6.3 percent and the Stamford-Bridgeport area at 7.3 percent.

Kevin Segalla, president of Connecticut Film Center and part of the team that brought NBC Sports to Stamford, said 2011 was the year that the state's film and television industry hit critical mass and it is going to carry forward well beyond 2012.

"Connecticut has a real, new industry in the form of television," Segalla said. "Since the NBC announcement, we've seen quite a bit of interest."

He said Stamford and southwest Connecticut have become the go-to spot for television production. That's generating more than production jobs, he said. The industry requires infrastructure improvements, and his own operation has spent $2 million on electrical upgrades alone.

There are sets to be built and equipment to be moved and all the other elements of production that requires support and supplies, Segalla said.

What 2011 set the stage for was a period in which the state and area will see more production done here.

"You feel this industry being created," Segalla said.

The expansion of entertainment is a positive sign, said Joe Carbone, president and chief executive of The WorkPlace Inc., in Bridgeport. But Carbone said this economy is far from firing on all cylinders.

If anyone knows exactly how tough the economy has been it is Carbone. His organization is the region's job placement board, which provides training and job-hunting assistance to the unemployed.

"As far as what's positive, I see some very moderate growth," Carbone said. "I have not yet seen any sector of the economy surge."

Carbone said health care has remained a positive for the region due in part to the age of its population. Connecticut, where the median age is 40, is the seventh-oldest population in the nation, according to the U.S. Census Bureau.

Health care growth will continue this year and next, he said, but a major problem for the economy remains the lagging performance of the financial sector.

"Financial services that's the engine to the economy," Carbone said. But right now, "Hiring people is a last resort."

The industry is in a cost-control mode, according to Carbone and others, and until that changes the region's and state's economies aren't going anywhere fast.

That's because it is the industry that pays the high wages, and those wages ultimately get spent in the local economy lifting other businesses, he added.

Carbone is not pessimistic. Like Deak, he doesn't see a recession.

"We're looking at five years or greater of slow growth," he said.

Kevin Peters, senior vice president of Morgan Stanley Smith Barney, said he's optimistic about his industry heading into 2012.

"It will be another volatile year," he said. "What that means is a great opportunity for people like me, who provide advice."

While concerns about margins and bonuses will continue, it should be a good year for investing in America's economy on the whole, which translates into some growth in Fairfield County.

"We appear to be one of the better economies in the world," Peters said. "But we are a very slow-growth economy."

There could be short-term turmoil in the markets, he said, but that will work out eventually. In the end, people can't park their money in zero-interest bonds and savings accounts. They'll need advisors, Peters said.